Guidance's Islamic home financing program attracts over 1,000 Americans
Guidance Financial Group has assisted over 1,000 American households acquire their homes in a Shariah-compliant manner. The company has originated $200 million of home financing contracts in the United States through its Declining Balance Co-ownership program.
The international Islamic financial services company has established itself as the prime provider of Shariah-compliant home financing in the United States. With an estimated population of six million and exhibiting superior per-capita income levels, the American Muslim community constitutes one of the world’s most attractive retail markets for Islamic finance. In terms of home financing alone, it is estimated that American Muslims generate $30 billion of new home mortgages annually.
Home ownership is recognized as a central part of life in America, with 69 percent of Americans owning their home. In the absence of Islamic finance providers, American Muslims had little choice but to lease their home or resort to a conventional mortgage loan. “I’ve been wanting to get a home, but I wanted to do it the right way,” stated recent customer of Guidance, Daoud Othman. “It’s not easy because everyone offers mortgages with interest and I refuse to do that.” With Guidance’s Shariah-compliant alternative, many American Muslims like Othman have begun to realize the benefits of home ownership without having to compromise their principles.
Guidance’s Declining Balance Co-ownership program is based on the concept of declining-balance partnership (musharaka mutanaqisa). Under this program, the customer does not repay an interest-bearing loan. Instead, he and Guidance purchase a property together and become co-owners. The program allows the customer to acquire Guidance’s share of the property over time until he becomes a full owner. Moreover, during the co-ownership period, the customer leases Guidance’s share in order to have the exclusive right to live in the property.
To ensure strict standards of Shariah compliance, the Declining Balance Co-ownership program was developed under the close supervision of Guidance’s Shariah Supervisory Board. An independent body, the Shariah Board comprises some of the world’s leading experts in the Islamic law of financial transactions, including Justice Muhammad Taqi Usmani of Pakistan as Chairman, Shaykh Abdul-Sattar Abu-Ghuddah of Syria, Shaykh Nizam Yaquby of Bahrain and several other notable scholars. — (menareport.com)
© 2004 Mena Report (www.menareport.com)